M&S First-Half Profit Plummets 55% Due to Cyber Hack Impact

Financial Performance Decline

• 📉 Marks & Spencer reported a 55.4% slide in first-half underlying profit, significantly impacted by a cyber hack.
• 💰 The adjusted profit before tax for the 6 months to late September was $247.1 million, down from over $500 million in the same period last year.
• 📈 Despite the profit drop, the company saw an increase in sales of over a fifth.

Cyber Hack Disruptions

• ⚠️ A cyber hack in April forced M&S to suspend online clothing orders for seven weeks and impacted click and collect services.
• 🛒 The hack also led to reduced clothing and food availability in stores, incurring additional waste and logistics costs.
• 💸 M&S had previously estimated the cyber attack would cost over $390 million in lost operating profit for the full year.

Recovery and Future Outlook

• 🩹 M&S forecasts a full recovery by March next year, aiming to mitigate the hack's impact through insurance, cost control, and trading actions.
• 🎄 The retailer is looking forward to a good Christmas season.
• 🚀 Shares in M&S are up over 3% year-to-date, having recovered most of the losses incurred from the cyber hack.
• 🔄 The turnaround plan initiated in 2022 under CEO Stuart Mackin had been showing positive results, with the group achieving its highest annual profit performance in over 15 years prior to the hack.